The Return of Don Drummond

"You need to look at what public services you want to deliver then what's the most efficient way of providing them," economist Don Drummond said in an interview with Tom Clark on The West Block.  "You don't arbitrarily constrain a certain outcome."

Drummond's not the only one who's suggested that clear-cutting the public service isn't the best way to nurture sustainable growth and efficient service delivery.

The Mowat Centre took a hard look at structural failings within the public sector and offered suggestions on how to fix them.

Through his Open By Default report on Open Government, Don Lenihan did the same thing.

The truth is that we have a oxymoronic silo-based system riddled with duplication, gaps, overlaps where title, process, position and information hoarding takes precedence over efficiency or results. Mid-managers are downloading the innovation imperative to staff, expecting them to include metrics on how they're going to think outside the box in their self-written performance reviews.

Clearly, they haven't heard of the candle problem.  You can't pressure people into being innovative. You can't force innovation through competition.  

Worse, a complete lack of communication flow leaves our public servants in the daily equivalent of shoveling water - they don't know what they're doing, why they're doing it or what result it's expected to have.

It should come as no surprise how heavily medicated our OPS is, but doing anything about that would mean a whole lotta culture change and a great number of entitled folk recognizing they're part of the problem.  

That's not gonna happen overnight, but it won't happen at all until someone takes ownership of the problem.  That ownership doesn't necessarily have to come from government.

But he pointed to an example of a recommendation ignored: restructure business subsidies.

There is plenty of money out there.  More than this, there's as ridiculous an amount of inefficiency in the private sector as their is in the public sector (we won't even get started on the NFP sector).  Like lighting a fire when all you want is light, a great deal of energy is being wasted to create new wealth without sufficient effort being spent on internal management.

This is particularly true where it comes to HR.  

Precious little time is spent on the "onboarding" process and few employers have the slightest grasp of environmental/work design impact on productivity, presenteeism, innovation and customer experience.  They just want things to work, damn it, without having to put thought into how to get the results they want.

Fortunately, there are best practices out there - people and organizations in the private sector that are adapting to the Knowledge Economy by improving how they do HR, how they consult and how they engage with their clients and the community at large.

Just imagine if there was a coalition of the willing that banded together and told government "we want to partner with you on these big, structural solutions - but we want your help, and we want to see you setting the example.

How likely is this to happen?  Not overly, but you might be surprised how many willing parties there are already.

It's a good kind of problem to work on, and to gain brand from being part of.

Just ask Don Drummond.

Death by Firing Squad: The Dark Ages Redux

"It sounds like the Wild West, but it's probably the most humane way to kill somebody," Ray said.

"There's no easy way to put somebody to death, but you need to be efficient and effective about it," Ray said.  "This is certainly one way to do that."

Efficient.  Effective.  Best bang for your buck. 

That's exactly what the Nazi Concentration Camps were about.

No, seriously - the thought was that the best use of tax dollars spent on incarceration was to profit through using criminals as labour.  Efficient, see?

You didn't want to spend a lot of money taking care of crooks anyway, so things like infrastructure and food weren't heavily invested in.  When prisoners start dying - complaining about hard work, freezing to death, whatever - you want to dispose of them the most efficient way possible.

Crematoriums were incredibly efficient this way - you could get rid of more bodies more quickly with less chance of infectious diseases spreading.  It was a bit of a PR nightmare, but people fundamentally don't care what happens to others, right?  It's not like we're a society or anything.

Of course, when your inmates are dying, you kinda need to find new ways to generate more bodies to keep the industrial/penal complex going.  By the point you get this far, you're a dictatorship anyway, so finding enemies of the state and undesirables isn't that hard.

I raise this point because we're seeing a dangerous tend emerging - union-busting, tough-on-crime legislation, chain gangs, firing squads.  States (including Canada) are getting more and more defensive, more secretive and increasingly ready to come down hard on anyone who disagrees with them.

We may look on Nazi Germany with contempt and judge the German people as somehow inferior in their capacity to allow inhuman atrocities to occur in their midst, but that's a red herring.

What happened in Germany under the Nazis can happen anywhere, at any time - the Armenian massacre, Rawanda, Nigeria, Syria, the Ukraine and yes - even here in North America.

If we choose not to care, if we choose not to pay attention and if we allow ourselves to be consumed by bitterness, we dehumanize ourselves.

Then, all bets are off.

We're an increasingly bitter bunch of bunnies. 

It's time we start asking ourselves what kind of society we want to live in; if we choose not to find ways to live together, we'll have no one to turn to when its us in the line of fire.

And there is no humane way to commit murder.

Simple innovation can delight customers and save you money (Ken Tencer)

Simple innovation can delight customers and save you money

Ken Tencer

Special to The Globe and Mail

Last updated Wednesday, May. 08 2013, 6:01 PM EDT

 

I was recently standing on a corner in Washington DC and my Blackberry started to buzz. In came a text that read, “Cab 118 is on the way and is less than one mile away. Text WHERE to see where cab is.” How appropriate. How timely.

I had just delivered a keynote on innovation at the America Means Business conference to a roomful of new and aspiring entrepreneurs. And one of my key messages was “it’s not just the products and services that you sell, but how you deliver them that can be steeped in innovation and bring delight to your customers...and no, great customer-centric ideas don’t have to cost a lot of money!”

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A seemingly mundane industry like cab service and Red Top Cab of Arlington, Virginia adopts a simple piece of technology that answers the age old question before it was even asked: “where’s my cab?” Simple, effective and certainly not cost prohibitive.

My point is that too many people think that innovation is limited to breakthrough products or services. It isn’t. In fact, process innovation – finding faster, cheaper and better ways to deliver your products and services to customers – can bring you a significant competitive advantage and substantial savings all while building brand equity, because there’s no better way to delight your customers than faster delivery of a better quality product.

Just look at Disney. They build delight into every process. When a child drops their ice cream on the ground at one of their theme parks, they turn that meltdown moment into one that delivers a happy memory. They replace the dropped treat with an upside down cone in a cup dressed up to look like a smiley face. Bad moment turned good.

Another example of innovative thinking closer to home happened when my 16-year-old son, Tommy, was still a toddler. We were shopping for groceries at Longo’s and he was having a fit in the fruit section trying to get at the grapes. One of the Longo’s staff saw me struggling and decided to cut some grapes up for him and put them into a little cup. Tommy was delighted and I was able to peacefully finish my shopping. Thank goodness Longo’s processes empower its people to go above and beyond. I never forgot it.

And the best news is that there are enormous hidden costs buried in status quo processes. Innovative thinking can be the key to uncovering and removing them. Done right, process innovation can even serve as a new source of financing.

It’s important to understand the difference between process innovation and the good old “slash and burn” method of boosting cash flow. In every organization, processes have a significant impact on costs: purchasing, inventories, reworking, downtime, lead-time, material travel time, delivery time, wasted time, and so on. All these processes add costs, which means they provide a wealth of opportunities for hefty savings. When you come up with new ways of improving throughput or order processing, or reducing wait-times and delivery times, it’s found money.

Let me be clear: I’m not suggesting that you should stop thoughtful, rigorous cost-cutting. But in tough times, urgent reactive cost-cutting is too often shortsighted and arbitrary, done to appease stakeholders, shareholders and short-term quarterly reports. Unfortunately the long-term consequences aren’t usually factored into the equation. It’s an accounting exercise – cut budgets, trim fat, do less or do it less well. Doing more with less is possible, but it usually comes from a strategic approach to process, not quick-fix cutbacks. Too often, companies cut their way into bigger problems as they deliver less service, reduce customer satisfaction, undermine brand value, lose market share, and sacrifice growth for the appearance of efficiency. These steps can lead in the wrong direction, and hurt the company. Of course, costs must be cut, but the real goal should be to lower costs while building customer loyalty, not disenfranchising them.

A classic example of short-sighted cost-cutting is the automated help lines many companies have adopted. Not only do they frustrate customers who would rather speak to a live person, but many companies plough their savings into outbound marketing call centres that become necessary to replace the infuriated customers they could have kept in the first place. Funny how a number of companies are back to advertising ‘live’ attendants as a competitive advantage.

The innovation challenge

It’s been well documented how American Airlines Fuel Smart program – “the employee-led effort to safely reduce fuel consumption by implementing viable suggestions from employees throughout the airline” – has saved the airline millions of dollars through such initiatives such as the single-engine taxi and use of tow tractors to move planes between terminals and maintenance hangars.

My challenge to you is to review your processes and uncover cost-saving opportunities that are hiding in broad daylight, waiting for a new approach. Realize the savings and then reinvest your newfound cash to create market-engaging breakthroughs in product and service innovations.

It’s a positive, growth-centric focus and is a far cry from myopically trying to cut your way to a better bottom-line. Process innovation can be, without a doubt, one of the easiest, least expensive and most productive ways of investing in your business’s future. Process innovation can also be easy and quick because it includes countless small opportunities seen every day that every company, big or small, can do right away.

Challenge your people to look at how your products and services are made, supported and brought to market. Empower them to share their intimate knowledge of the processes they use every day. After all, no one knows them better – their strengths, their weaknesses, their potential to transform.

Think very simple (for now). It worked for Red Top Cab and Disney and it can work for you, if you’re up for the challenge.

Ken Tencer, CEO of Spyder Works Inc. , is a branding and innovation thought leader who helps organizations reimagine their futures. His second co-authoured book on innovation, Cause a Disturbance ( www.causeadisturbance.com ), is due to be released Fall 2013.

Why Transparency Matters

Because ultimately, opacity is inefficient.  It breeds complacenes and laziness.  If you want to keep your edge sharp, you gotta run against it every now and then.

An insulated boardroom is an ineffective boardroom

By Lucy P. Marcus

January 15, 2013

 

 

executive boards | libor | ubs

“The level of ignorance seems staggering to the point of incredulity. Not only were you ignorant of what was going on, but you were out of your depth.”

‑ Andrew Tyrie, MP, chairman of the Parliamentary Commission on Banking Standards (PCBS)

Last week senior executives of UBS testified before a British parliamentary panel about their part in the Libor-rigging scandal. What they said sent a discouraging signal that they, and others in the banking sector, are still operating as if they are out of touch and tone-deaf in a sound-proof room.

U.S. and British authorities have implicated UBS, Citibank, Deutsche Bank and Royal Bank of Scotland, among others, in fixing the Libor rate over several years. UK lawmakers, responding to a public outcry, set up the Parliamentary Commission on Banking Standards to look into the UK banking sector’s professional standards and culture; discover lessons to be learned about corporate governance, transparency and conflicts of interest; and clarify the implications for regulation and government policy.

Andrea Orcel, chief executive officer of UBS’s investment bank, told the committee that “the whole executive board and board are very focused at recovering the honor and the standing that the organization had in the past.” But that’s still putting the emphasis and focus on the wrong thing. What these institutions need to be thinking about is rebuilding trust and stability. Using phrases like “recovering the honor” sends the message that they are focused on themselves and not on the effect their actions have on those around them – their clients, the employees and the global financial system.

The global financial system has depended on “trust me” and “we’re the experts,” and an implication that the whole thing is too complicated for people outside the upper echelons of the financial services industry to understand. But now, with the Libor-rigging scandal, with JPMorgan’s London Whale and with the perceived collapse of the banking system and bank bailouts, the financial services industry has broken that trust. It has become clear that a lot of the people in the industry, – indeed, a lot of people sitting around the industry’s board tables ‑ don’t understand what is happening there, either.

It is time for financial executives to think about the changes they can make to earn back people’s trust and demonstrate that they are trustworthy and can bring stability back. A blueprint would look something like this:

Action: Enough talk. There have been plenty of mea culpas, including in last week’s PCBS hearing, and lots of talk about what the financial services industry should do and what it needs to do. UBS’s Orcel talked about the need to “reform the governance, incentive structure and the overall supervisory approach right across the global financial industry.” People have lost trust, and no one is going to believe it until they do it. The focus is now on results.

Governance: Bank boards and senior management need more people who understand what the banks are doing, understand what they need to be doing, are unafraid to ask hard questions and are able to take swift, strong action. Barclays has a new chairman and a new chief executive, and they have set out clear ideas about re-examining what happens around the board table. They are saying all the right things, but they’ll have to demonstrate that they can bring about real change.

Transparency: If banks are taking action and making changes, people need to see it happening. JPMorgan’s board voted this week to make public an internal review on the failures that led to the loss of more than $6.2 billion. That is a step in the right direction. Any time there is a question of openness, the default answer has to be “yes.”

Accountability and performance: It is earnings week for some of the biggest financial services firms. It’s being reported that Barclays and Deutsche Bank will cut investment banker pay up to 20 percent. Pay packages and bonuses need to reflect the down times as well as up. If they do not, people will know it is business as usual. Also, it was reported this week that Goldman Sachs toyed with the idea of delaying UK bonuses to take advantage of a fall in tax rates but decided against it. Even considering such a move rekindles mistrust and the feeling that banks are simply not getting the public mood.

***

Lastly, the public has a part to play in all this. It was taxpayer money that bailed out a number of these institutions around the world. We cannot be passive and hope that others will sort this out for us. We all need to be speaking up on this issue, asking the questions of the institutions that we have bailed out and holding lawmakers to account to ensure they continue to monitor the financial services industry.

People did trust the financial services sector, but it broke that trust, several times over, and it is going to be a long road back. The industry will need to prove it is willing to be action-oriented and bring about real change, have oversight that counts and be transparent and accountable. Most of all, they have to know that people are watching, and that the attention is not going away.

THE FUTURE OF PUBLIC SERVICES: Built on an Open-Source Public Service Platform

“Why don’t we create a collaborative model of healthcare?” – Don Tapscott

 January 12, 2010 – a 7.0 magnitude earthquake shakes Haiti to the bone, reducing weak infrastructure to rubble, wiping out 220,000+ lives and putting the fate of a nation in question.  Worse earthquakes had hit other populated areas in recent memory, without the same degree of impact.  What led to Haiti's particular tragedy combined a lack of planning with selfish interests that saw sub-standard buildings erected in the first place.  The absence of proper maps and census data only made a potential response plan ever harder to develop.

Ironically, it was an altruistic, coordinated effort by the international community that stepped in to address the crisis.  The resources of UN agencies, USAID, individual donors from Japan, school groups in Europe and countless other sources in Canada and around the world was largely coordinated through open-source, online maps and crowdsourcing. 

An Ushahidi-based open source platform became the hub around which government and Not-For-Profit agencies were able to interact in a planned, coordinated way to connect the people of Haiti with the services and resources they needed.  A person stuck in a collapsed building could send a text to a friend, who could pass it on to an appropriate official, which would then be coordinated through a central point in the States to get the right people and resources on the ground in Port-au-Prince to go where they were needed.  Someone moved to make a donation after watching footage of the devastation on the evening news could access the system in the same way, learning the best opportunities to contribute and putting their offering into the mix.

The Haiti experience gives a great example of how an online, Open-Source Public Service Platform can provide an opportunity to transform the existing social service model into something adapted to the realities of the 21^st Century.

Think about it – there is broad concern that social services cost too much and that much of that cost is lost to inefficiencies.  It’s like using an old light bulb – little of the energy used actually gets translated into illumination.  Services aren’t always provided where they are needed, or aren’t as accessible as they should be, or people simply don’t know the right entry point to reach those services.  Countless paid hours are spent by government employees trying to help frustrated clients find the specific service they need – and that’s before you add barriers like transportation access, language/cultural barriers, wheelchair/stroller accessibility, etc.

Inefficiencies, cost, access challenges.  You can add to this increased wait times as people struggle to find appropriate services, or end up needing advanced services because they were unable or un-empowered to connect with the right front-end services before an issue emerged.  Also worth mentioning is the recent federal contraction on census data collected and the broad social concerns around accountability and customer service within the public sector.

All these can be problems of the past, thanks to crowdsourcing – and the solution can be realized in a way that doesn’t add to the tax burden.  Again, that solution is an Open-Source Public Service Platform.

A quick example of what the benefit of an integrated, open-source online social service platform would look like: a First Generation Canadian living wherever, trying to find out how to diagnose and treat an ailment in her non-English speaking, wheelchair-bound mother -- could use an App on her phone to narrow down her search and tailor results to include the language and transportation need components.  The search results would include phone numbers for the service providers and a broader coordinating entity, for example a LHIN.  The lady would be able to find and connect her mom with the specific help she needs and how to get to it with a few clicks on a blackberry.

How would you begin to build something of such complexity and magnitude?  Wouldn’t the cost be preventative?  Nope – that’s the advantage of crowdsourcing.  If one central entity – ideally, government – were to provide the basic digital infrastructure (the Ushahidi model is already established and is freely available, and RIM is probably looking for work that could include adapting it for this purpose), the various players involved would organically populate the rest.  A detailed map would be a great, free tool for gaining statistical data, developing broad understandings of service distribution and need (facilitating planning and reducing duplication, gaps and overlaps) and provide opportunities for oversight that would find the right balance through sheer volume.

Service providers inputting their data into the map could use a template form to know which pieces to populate their corner with.  This would include things like address, broad service category, specific service category, accessibility, languages spoken, contact information, etc.  Each entry would have a comments section with an aggregated customer service satisfaction indicator.  When public transit, doctor’s offices, social service offices, etc. plug their information into the map, it would be an easy matter of using an App on a phone or a computer to connect with the right search terms and cross-reference them for proximity, availability and so on.  A secured level of use could record all the data that helps government plan funding allocation and public need in a way only dreamed of now.

We’re already starting to do this by recording wait times in hospitals or results in schools; a public service platform is simply the next logical step.  The Government of Ontario has taken a huge leap forward through a Social Innovation Summit hosted by SiG@MaRS and by launching a wiki allowing Ontarians to participate in the world’s first crowd-sourced policy paper.  The Ontario Liberal Party learned from Facebook and created FRed, creating an online community for members and those interested in learning more.

This same principle can take advantage of the growing connectivity in our society in countless other ways; you could use an open source map to plan your next vacation, if tourist-service providers sign up, or to find new employees/help transition ones that don’t fit without needing to fire them.

Here’s an example of what such a map could look like, using fair trade as an example.

The challenges of today are steering us in one clear direction – collaboration.  The only way to face our current economic, health and quality-of-life woes is to find efficiencies in service – not by cutting the offerings themselves, but by ensuring they are properly coordinated.  An Open-Source Public Service Platform is the perfect tool to make this happen.