Hey, Steve. Hey, Jeff. How are you doing? I'm doing great.

Great. Hey, thanks for making the time to, uh, to talk and share some more about your, uh, your upcoming book with Gene. Absolutely. Thanks for having me.

Yeah, and it's a Pleasure. All right. Uh, so, uh, in, in your book, um, you, you, you share a lot of stories about a lot of companies, and yes, you've observed, uh, that some companies have, uh, unlevel performance on a level playing field. Yes.

Uh, and the, and the level playing field was for, you know, for different companies, all things being equal. They had same resources, uh, tax treatments, customers, raw materials, suppliers, all of those things. And yet, um, there were different levels of performance. So, uh, what, what, what wasn't equal?

What explained that different level of performance? Yeah. Long and short, it was the management systems, right? If, um, everyone has access to, uh, more or less similar outputs, and yet, I'm sorry, more or less similar inputs.

Mm-hmm. Yet the outputs are vastly different in terms of, uh, quality, productivity, time to market work, workplace safety, on and on, and on and on. Environmental impact. Um, the only thing left to explain the difference, uh, in output based on the consistency and input, is how those inputs are managed.

Right. And that's the management system. Yeah. So, so what is, what is the essence of that, of that management difference between the, you know, the companies that are, that are performing and, and the companies that aren't?

Yeah. So fundamentally, the, the successors, um, the success, the successful companies, the successful organizations are those who, uh, and the managers in those organizations who view their task as creating conditions in which people can give the fullest possible expression to their innate creativity, both individual in terms of solving problems, but also in terms of how those individual efforts come together through collective action, towards common purpose. And I'll just elaborate a little bit on that, that difference, because very often when we think about management, we think about the management of resources, and somehow people disappear into the background that the resources or the, uh, materials that throw flow through machinery as if those machines aren't there in the first place, to allow people to express what they understand about what to do, how to do it, and why to get it done. And, uh, what we see in consequently in the organizations that underperform is that they, uh, underappreciate what their workforce can contribute towards solving the problems.

But whether it's the, um, the mini micro recurring problems in operation, or the much greater problems in designing systems and deploying systems, um, solving the, those problems, that the existence of those problems encumber achieving success and the resolution of those problems ensure success. Yeah. I, I think I've, I've heard you, uh, use, use this quote is, uh, somebody saying that you know better, uh, instead of having three minds engaged in solving a problem, you know, I can en engage my entire organization of 30,000. That's right.

Yeah. Yeah. So, um, to give credit where credit is due, you know, I've had a number of influences in my real appreciation of the difference being the management systems and the, the difference in management systems being how well they engage the minds of the people who come into the organization. Uh, Paul O'Neal, who was a very important, uh, played a very important role in my professional development in my life as a, as a mentor, and, and as a friend, said that, um, the big difference in his management of Alcoa, and just as context, Alcoa has these wildly hazardous, dangerous industrial processes, all sorts of energy, which can do great, great harm to human beings.

Um, they went from having what you would expect in terms of an injury rate and a fatality rate to near perfect safety. And they became, during his tenure, the safest employer in, in the United States and, um, of, Of any Employer, any employer, any hospital, library, university consulting firm. That's right. Yeah.

Thanks for that. Yeah. It was more likely if you were working at a large consulting firm that you would hurt your back lifting a box of copier paper than someone in an Alcoa, um, facility would get burnt, smushed, crushed, you know, shocked, et cetera and so forth. Wow.

Um, and, uh, when Paul would explain how that happened, he said, look, you know, it's a very difficult thing to, uh, mine refine and produce aluminum products. And he said, what we did is everyone else in our field would, um, have people come in the door and say, we have a locker for you. Put your coat, your lunchbox, and your brain in the locker. 'cause we need your bodies to run the machines.

And he said, we flipped that around. We said, as people came in the door, put your, um, coat and your lunchbox in the locker and, and, and thank your bodies for bringing your brains to work every day. 'cause of all the problems that we have to solve. And if we can engage you here and there and, um, have local problem or local problem solving around idio idiosyncratic situations, and we can take some of the local problem solving and have it synthesized into more systemic solutions, we're gonna be well ahead of the game.

And it turned out he was wildly right about that proposition. And, um, not only was he wildly right about the, that proposition, Alcoa, he was describing what happens across all great organizations that they, when people come in, it's there because their brains are coming to work, and it's, the bodies are doing the favor of carrying 'em in as opposed to checking the brains at the door. Yeah. So, uh, so in, in your book, you, you describe, um, how, or you describe two zones mm-hmm.

That a company can, can find themselves in. Yes. Uh, you call it the danger zone and the, and the winning zone. That's right.

What, what are those two zones and how, how do they differ from one another? Absolutely. So this danger zone and winning zone, um, speaks to the environment in which we try to engage people their, their cognitive abilities, right? Mm-hmm.

And it gets back to the basis of proposition. If everyone has, um, got access to the same things, the inputs are equal and the outputs are different, the only thing left is the management system that explains that difference in outcome. And, uh, the difference in management systems is about how they engage people's creative potential and give it opportunity to be expressed. So we start thinking about what are conditions in which it's really, really hard to give full expression to one's creative potential.

So we can, um, give people very, very complex situations, which, uh, sense making is very hard to do. Mm-hmm. Alright. That would put you in the danger zone.

We can put 'em in situations where things are very, very fast moving, so they don't have opportunity to be deliberative and thoughtful and contemplative. Um, everything has to depend on already hardwired habits and routines. Uh, we can raise the risks and the hazards, so if they get the wrong answer, they're not gonna get a second chance. We can raise the cost of any iteration.

So we only allow few of them, and we can really, um, limit the amount of time we give people so that, um, they really can't learn. 'cause we talk about learning occurring across cycles, but if you limit that to one or two cycles, they can't learn. So the danger zone is, um, the set of conditions in which, uh, it's just really hard to come up with, uh, new and good ideas about what to do, how to do it, and why to do it. The winning zone is the opposite, which is what we do is we take situations and take big complex problems and break them into smaller pieces so that they're easier to solve.

We slow things down. Um, maybe not the performance environment. 'cause it operates, you know, if you're flying a plane, you're flying a plane at the speed it needs to fly, flying a plane in a thunderstorm, the thunderstorm is setting the pace of the performance environment. But we bring people back into environments, which they can solve problems ahead of performance in which they actually can be thoughtful, deliberative, reflective, and that sort of thing.

So, um, make the problem simpler. Make the problem solving environment or bring people into a problem solving environment, which is slower moving, reduce the risk in the hazards in that problem solving environment, um, so that, uh, they can actually run iterations, give them opportunities to run, um, iterative experimentation, even trial and error. And, um, uh, if we tie all those things together, we get people, um, and their ability to be creative out of a, a place where it's very hard to be creative and to a, a place in a situation where it's much easier. So danger zone back into winning zone.

Yeah. I, I heard you referenc in that, in that, uh, that response, some of the mechanisms, I think is the, the what, what you described in the book, um, for how an organization can move from that, that danger zone to the winning zone, the ification simplification and amplification. That's right. Yeah.

So could you describe, describe those three? Yeah, absolutely. So the dominant theme here again, is, you know, management systems succeed if they create good conditions in which people can solve problems, which really means moving them from that danger zone into the winning zone. And so then the question managers say, well, how do I actually do that?

Right? And we say, this is actually a sort of a mechanistic problem. There are mechanisms to do it. So there are three ification, as you mentioned, is, um, making problem solving easier by taking people out of these fast, moving very harried, uh, time compressed environments where you're dependent only on the hardwired habits and routines.

Mm-hmm. And bringing them into, uh, conditions in which they can actually solve problems in a more thoughtful, reflective fashion. So moving out of fast-paced performance into planning, which has ample feedback and practice, which has multiple iteration. So that's one mechanism.

Mm-hmm. Making the problem solving easier. The second mechanism is simplification, and that's, um, to make the problems themselves easier. And, um, by simplifying problems, we take things which are, uh, very large, very complex, highly intertwined.

And, and right there that large, complex, highly intertwined, um, is double jeopardy. One, trying to figure out how something works, which is large, complex, and highly intertwined. Yeah. Is wickedly hard to do?

Yeah. The other part is anything that's large, complex, and highly intertwined has many, um, hands attached to it and many minds attached to it, trying to figure it out simultaneously. So just the cost of coordination on making experiments and changes and, um, testing ideas on things which are large and complex and highly intertwined is wickedly difficult. So the simplification, um, mechanism is to take things which are very, very big and break them into smaller pieces.

And the smaller pieces have lots of advantage. The smaller pieces typically are simpler in their architecture, so sense making is easier. Um, there are a few people attached to any particular piece. So, uh, the coordination costs are, uh, fewer, um, less difficult.

And what that all sets us up to do is have, uh, more opportunity for people to solve simpler problems faster, more frequently and parallel. Mm-hmm. And thereby, um, having much greater output of people's creative potential. Yeah.

So, uh, so with, with those three mechanisms, what, what gets in the way? What are the major challenges or obstacles for, for organizations trying to deploy these mechanisms right? Or execute these mechanisms? Yeah.

So, um, as far as the three mechanisms of bringing people into an environment where it's easier to solve problems, make the problems easier, and then I skipped one when I was answering before this third mechanism of amplification, making it more obvious you have problems. So what's the obstacle is that, um, very often we put people, and particularly managers, people responsible for creating conditions for other people. We put managers in situations where they get so overwhelmed by the pressures of operational tempo, um, that they don't feel or they don't even recognize the opportunity they have for recreating, redesigning, um, the conditions in which everyone else is working. So, um, the whole operational tempo pressure of get it done, get it done, get it done, kind of Sort of suppresses the use of any of these mechanisms.

So it's get it done, get it done, get it done, sort of de amplifies evidence that you have problems. Because if you want to admit you have problems, then you have to pause, you know, see a problem, solve a problem. So, um, the get it done, get it done. Operational tempo sort of suppresses rather than amplifies the obviousness that there's something to be, um, fixed.

The, um, get it done, get it done, kind of thing. Also, um, in terms of the slow ation mechanism, if slow ation says, let's take a pause for everybody, or take a pause, uh, for some people, or create a side parallel process where people can actually do slow deliberative, creative, self-reflective problem solving in planning and practice, well get it done, get it done, get it done, discourages that. 'cause you don't want to take the pause from performance back to any of these things. You don't want to quote unquote allocate, um, resources, you know, people's minds and thoughtfulness to the stuff that's occurring in parallel.

'cause it's not actually getting it done, getting it done. And the operational tempo pressure also, um, affects disability of simplification. 'cause to simplify things actually requires that, you know, you and I say, whoa, let's take a pause. Look at this big huge complex, highly integrated, hairy situation we've got, and, um, figure out how we can break it into smaller pieces so that more people can be solving in parallel, simpler problems.

So the operational tempo thing is a killer all, and, and, and I, I mean that metaphorically, but in fact, we've seen in, um, too many cases that the get it done operational tempo pressure has catastrophic consequence. Mm-hmm. Yeah. I think you, you, you've shared some of those stories.

Mm-hmm. Um, what are some of those, some of those catastrophic stories where that operational tempo leads to really bad outcomes? Yeah. So, um, I have, you know, uh, some experience, you know, working with healthcare providers on, uh, improving the quality and safety of care.

And, um, when I first got involved in this, back in the early two thousands, there were a number of case studies written about, you know, how, um, patients suffered as the consequence of system failure. And consistent of those was well-meaning, well-trained, highly motivated, um, pharmacists, technicians, doctors, nurses. Mm-hmm. Um, trying to provide the best possible care they could, but because they felt already overwhelmed about the, uh, meeting the needs of their patients, they didn't go through the use of these mechanisms at first amplifying that there was something to be fixed.

Mm-hmm. Um, slowing to figure out better how to design the system in which they were working to, uh, not have these difficulties. And then in that ification phase, simplifying things so that people could better execute on their work. So that's certainly an example, another example of, um, where operational tempo literally turned into a killer was a deep water horizon.

Mm-hmm. So now if you've seen the movie Yeah. You know, the movie is set up that you have to have a villain, right? So John Malkovich is the, the villain in there putting go, you know, and he's, he's the, the personification of driving operational tempo.

But it turns out you don't need sort of the, um, that personification of pressure for people to just keep operating. In the case of Deep Water Horizon, that ship was an engineering marvel. The ability that it could go out to sea and, uh, locate itself over, um, a drill site and maintain all the necessary stability to actually start drill down into the earth's, uh, surface and, um, find, uh, where you could start extracting hydrocarbons. It, it's a phenomenal thing.

Mm-hmm. And, um, there were companies that were coming to the folks who own Deep Water Horizon saying, look, we really need your services. And it doesn't have to be based just on sort of corporate greed. It's like, oh, we're, but all those requirements of, Hey, Jeff, show up.

We really need your help doing something right. Says, all right, well, the, uh, the scheduled maintenance will delay it. We'll put a waiver on that, the repairs, we'll put a waiver on that. The training will put a waiver on that, the communication back and forth across shifts.

We'll put a waiver on that. And why is that? 'cause we're wickedly popular, people want us to do our work. Mm-hmm.

And so, um, there are many, many more examples where operational tempo had very negative consequence. And I think the one thing I would urge people is, don't look for the villain. The villain is not necessary for operational tempo to drive result in a very negative fashion. Right.

Right. So, uh, um, one of it, this sounds like this operational tempo, um, line of reasoning, uh, actually connects to one of one gene's books. Mm-hmm. The Unicorn Project.

We talks about the, the five ideals, and one of those ideals being, uh, more important than doing of daily work is the improvement in doing of daily work. Does that sound Yeah, It's a hundred percent along the mind. Um, look, anything that human beings design is gonna be designed wrong. It just, it's inevitable.

Right. You know, like, wait, what, what anything, just anything. Pick anything. Right.

Um, you know, we're, we're, we're finite in our time. We're fin out in our capacity, our wisdom, our vision, et cetera. And, um, the situations we're trying to gain some mastery of, and expertise and capability around are far greater than anything we can possibly do. And so, uh, that kind of gives an obvious, um, it's not even a choice.

It's so obvious a requirement that if we've designed something, we want to use it, we have to recognize that the thing we've designed is going to fail somehow in use. Mm-hmm. And the only way to make progress on it is to, um, repeatedly almost with paranoid intensity, um, and paranoid passion, recognize its failures and keep coming back on its improvement. Mm-hmm.

Um, that said, if we're working with, um, at best, and I think this affects most people, the sense of I don't have time to stop and pause and slow down or recognition that what we've created is imperfect will be overwhelmed by the, um, this need to get it done, get it done, get it done. Now, there are some cases, and, you know, without naming names, I think there are some cases where people actually believe that the thing they've designed is as perfect as it needs to be to operate as perfectly as it needs to be. Um, and there are examples where you say, you know, actually that's the arrogance these managers have had about that thing. Yeah.

But I don't think it's necessary. I think for most people, just, um, the operational tempo pressure is enough to say, I don't have time, as you said, uh, with the Unicorn project to, um, slow things down, do some reflection, make things simpler so we can better engage people's creative energies. Yeah. I, I think I, I think I just heard something pretty, pretty profound, which is usually the case when I'm talking to you.

Uh, I think what I heard was I, if you, a, a diagnostic might be, uh, if, if I believe that, uh, I I have too much to do and I can't slow down, that's sort of indicator number one, right. Or, uh, the thing that I've designed doesn't have any flaws or can't be improved. Um, maybe that's, you know, that's right. Maybe, maybe that's a dangerous signal.

Yeah. That's very funny. It's, uh, the way you say it is that, uh, complacency and anxiety, which we typically don't associate as being coupled Yeah. Um, are actually signals of the same thing, which is, uh, the situation you're in.

Um, you don't understand well enough for it to occur. Well. And so now this is the time to hit the pause button, slow down, step outta the performance environment, and do some sort of feedback, rich, uh, aggressive planning and, and, uh, learning rich practice. Yeah.

Uh, I, in, in your book, you, you talk about a lot of, uh, a lot of examples. You, you highlighted a lot of examples of, of going back to the winning and the losing organizations. You know, here's an organization that won, and here's an organization that lost. Um, are there, are there examples of, of an organization that started out as a quote unquote loser and turned itself into a winner?

Um, absolutely. So, um, well look, you know, my, my research roots and my experiential roots are with Toyota. And, uh, again, I think we should acknowledge that Toyota's been the leader in a highly competitive industry for 50 years. Right?

So, uh, while looking at Toyota may seem passe to some, as opposed to the 1980s, early 1990s, again, 50 years of leadership, that, that, that's pretty good. That's like the Celtics back in the day, right? Yeah. I'm a Celtics fan, so Right, right.

There we're Good. I was afraid I was sitting across from a Lakers fan, but they were pretty good. They were, were too c l a. Right.

Um, so 50 years of diamonds. But if you look at Toyota, at one point, they were an awful car company. Um, they were awful by quality, productivity, labor management relations were simply atrocious. And, um, there, there's some fantastic history about Toyota, but that history is really around the epiphany about changing the conditions in which people are working, and the epiphany about how to treat people who are coming in the door every day.

And when Toyota leadership had that epiphany, those epiphanies in the, um, the 1950s they created, they set up for themselves a, a trajectory marked not just by slope, but by acceleration in terms of, um, coming from behind, catching up, getting ahead, and, uh, to this day staying ahead. Yeah. Yeah. Indeed.

Well, in fact, actually, you know, we're talking about, um, connect me back to Toyota as a organization that reshaped itself. So I'll just pop this in now, is that, you know, as someone who's got both deep roots and important sort of branding connection to Toyota, at this point in my career, he'll say, oh, well, what about electric vehicles? And, and, uh, Tesla, and I'll have to admit, I don't know. Mm-hmm.

Um, there's a whole side conversation about Toyota's investment in hybrid, but to humility. So, Akio Toyota, so whose, you know, part of the Toyota Dynasty was a chair of Toyota, and he made some very public statements about his skepticism about electric vehicles, um, being that important in the future. And, uh, recently he, he, he retired and handed the, um, the responsibility for the company to a much younger man. And his retirement statement was so counter to what most are, most are like, Jeff, you know, I've been, uh, in this industry for a long time, and now it's time to retire and hand on to the next generation.

But he was more explicit than that. He says, I just don't get electric vehicles. I've said time and again, I, um, don't see the potential. I don't see the opportunity other people do.

It must be I'm missing something. Right. And, and so he took his complacency as an opportunity to amplify a signal, which is saying, if I don't get it and other people do, I shouldn't be complacent, I should be worried as all heck. And he said, I'm gonna pass this, uh, responsibility for this company to someone 10, 15 years younger than me.

'cause maybe he can get it and figure it out better than me. Yeah. I think that shows some, uh, great self-awareness Yes. And humility.

That's right. Which, uh, you know, maybe I wish were a little more common these days. That's right. Um, so along those lines, uh, you, you may have heard the, the cliche or the quote, uh, we have seen the enemy and the enemy is us.

Yes. It strikes me that you and Gene are writing a book about management systems that are gonna be largely, you know, implemented. Right. And the book is gonna be read by management.

And, uh, and yet the, the implication is if if you're not getting the results that you expect or want from your organization, you might be the problem. Yes. So how do you think management is going to, is gonna take that message? Yes, it's a great question.

Um, I hope they take it well. Right. We're spending a lot of time on this book, and, you know, hopefully it has, uh, you know, uh, value to others, right? I mean, that's why we do our work in the first place.

I mean, we, everybody, the reason you show up at work is to do something where, um, you feel you're gonna succeed at it. Um, when you do it, someone will appreciate it and it actually gives you meaning into your own life. Mm-hmm. So, um, if this book goes out to managers and it doesn't, uh, help them, um, not only will it have failed, you know, criteria, one, they won't appreciate criteria two, and for all the value it gave us, well, I think it'll be disappointed.

So anyway, we hope it'll appeal to them. But, um, the way we're writing the book, and, and this is how we feel, um, we're not looking, again, we're not looking for villains in our storyline. We don't need villains in our storyline. We just need well-meaning people who, um, found themselves in a pattern of behavior that's actually costing them more in terms of aggravation, anxiety and effort, and actually getting them less delight.

Yeah. And this ties into, um, something you mentioned before about these emotional signals, be it, uh, complacency or anxiety. Is that what we're hoping? Um, someone will pick this up and say, son of a gun, um, I constantly feel anxious because of this pressure to get it done, get it done, get it done, and I, and, um, I can't get it done.

And the people, um, for whom I'm responsible, the conditions for which I create for them is not letting them get it done. Mm-hmm. And so we're hoping that, um, manager will actually read this book and some of the vignettes in cases we inserted and say, wait a second, I recognize myself. Yeah.

And also by the combination of vignettes in cases say, wait a second, I re myself recognize myself in the before condition. And, um, if in the vignette in the case that's what the after condition looks like, I actually have a map to go from where I am to where I need to be and where I need to be. And where I'll get is a place of, um, less anxiety, less worry, um, and a place of greater accomplishment, both for myself and for the people for whom I'm responsible. I think that's a double goal.

Yeah. Hope so. So, uh, so let's end with this. Um, I'm gonna, I'm gonna use jean's famous magic wand.

I'm gonna give you the magic wand. And if you could, uh, think about the enterprise leaders and and management that's out there there that, um, is on the other end of that, that book experience that you, you're gonna give them, um, what's one message, uh, that if you could have them here and act on, um, what would that message be? Yeah, so I would say for those folks, one for themselves, take a moment to take, to breathe and think and create for yourself. Even if it's momentarily those winning zone conditions where the situation you're looking at, you're looking at it in a way that you can be thoughtful, you can be self-reflective, you can be contemplative.

That that situation you can examine, be it through, uh, tabletop experiments, thought experiments, just, you know, sitting around, um, mussing about possibility and perhaps sharing ideas back and forth with colleagues. Did you give yourself that opportunity to step out of your own personal danger zone and create a winning zone to re to, uh, contemplate and re contemplate the conditions for which you're personally responsible? And when you've done that, um, the second encouragement is as you go through the book, think about what you can do for the people for whom you're directly responsible to create such conditions for them. And, and, and, and part of the way to do that, of course, is actually go see, hear, experience, what they're doing.

Don't, don't have these connections through reports and presentations and metrics and that sort of thing. Actually have the empathetic moment of seeing the experiences that other people are having experiences for which you're responsible. And start asking the questions about what makes your work difficult? Do you have clarity about what to do?

Do you have clarity how to do it? Do you have the resources, whether it's um, uh, materials or machinery or information? Do you have the things you need to succeed? Um, when you do your work, is it appreciated?

And when you do that work, and even if it is or not appreciated, is it something that adds value to, um, how you think of yourself? So give yourself that moment and then give them the moment. And, um, that combination of behaviors we're predicting that will make things not only better for the managers, but better for the people for whom they're responsible. I, I, I think you just gave a, a really concise set of questions that managers might wanna consider asking their, their teams.

Uh, we can, that Was pretty good. Well, thank you. Yeah. Yeah.

And since the book is still not, uh, printed yet, we can, uh, incorporate that into it. That's right. So thank you. Thanks for Your time and your perspective, Steve.

Oh, for sure. It's always a pleasure. Thank you for asking me.