PDSA into the Unknown

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Electric cars have more to do with global warming than you think. They are both involved with solving extremely large problems in the face of uncertainty. We are tempted to do research, look for silver bullets, or wait for issues to be clarified. But, the future will never wait. It will unfold in ways we cannot always anticipate.

Dr. Henry M. Pollack, author of "Uncertain Science, Uncertain World" has given us some useful characteristics of our future and strategies for dealing with this great unknown. Dr. W. Edwards Deming has bequeathed us much, including Plan-Do-Study-Act. These are two great sets of thoughts. They are rich veins of wisdom that can be combined. This presentation shows how they can be applied, and should be applied, to issues of great complexity and uncertainty. How we can, and must, move forward in the face of uncertainty. Move forward into the Unknown.

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PDSA into the Unknown

  1. 1. Menlo Park Associates, LLC PDSA Into The Unknown Moving ahead in the face of uncertainty Mensa Regional Gathering SEMMantics XXIX May 5, 2007 Troy, Michigan© Menlo Park Associates, LLC 1
  2. 2. Menlo Park Associates, LLC PDSA into the Unknown Moving Ahead© Menlo Park Associates, LLC 2
  3. 3. Menlo Park Associates, LLC PDSA into the Unknown Moving Ahead The University of Michigan team won the 1990 GM Sunrayce. They had very good students, sponsors & technology. They were able to simulate the performance of their vehicle under many different scenarios of future weather conditions. This was because they were the only entry to have a complete Weather Team.© Menlo Park Associates, LLC 3
  4. 4. Menlo Park Associates, LLC PDSA into the Unknown Moving Ahead The University of Michigan team won the 1990 GM Sunrayce. They had very good students, sponsors & technology. They were able to simulate the performance of their vehicle under many different scenarios of future weather conditions. This was because they were the only entry to have a Weather Team.© Menlo Park Associates, LLC 4
  5. 5. Menlo Park Associates, LLC PDSA into the Unknown Complexity & Uncertainty Every large organization should have a Weather Team. Governments, companies: public and private, profit and non-profit. Organizations need to articulate future needs. And implement a methodology that takes them into the future.© Menlo Park Associates, LLC 5
  6. 6. Menlo Park Associates, LLC PDSA into the Unknown Types of Problems Certain Uncertain Traffic Simple Shopping Stock market Mathematics Global warming Complex Chemistry Economics© Menlo Park Associates, LLC 6
  7. 7. Menlo Park Associates, LLC PDSA into the Unknown During WWII US Armed Forces used Pacific Islands as bases: Impacted local economy Population became accustomed to supplies delivered by planes© Menlo Park Associates, LLC 7
  8. 8. Menlo Park Associates, LLC PDSA into the Unknown At the end of the War Islands were abandoned Left behind a big problem: How to recover: Go back to the original island economy and way of life? Bring back the planes?© Menlo Park Associates, LLC 8
  9. 9. Menlo Park Associates, LLC PDSA into the Unknown Their Solution Do what they saw the Americans doing that caused the planes to land bringing supplies. Bamboo huts Bamboo desks Bamboo microphones Saying things into them they heard said by the Americans i.e. creating a “cargo cult”© Menlo Park Associates, LLC 9
  10. 10. Menlo Park Associates, LLC PDSA into the Unknown Operating Without A Theory In management consulting terminology this is what is called a “Best Practice”.© Menlo Park Associates, LLC 10
  11. 11. Menlo Park Associates, LLC PDSA into the Unknown How Not to Solve Problems© Menlo Park Associates, LLC 11
  12. 12. Menlo Park Associates, LLC PDSA into the Unknown Saturday Morning Physics Uncertain Science, Uncertain World by Henry N. Pollack University of Michigan© Menlo Park Associates, LLC www.amazon.com 12
  13. 13. Menlo Park Associates, LLC PDSA into the Unknown Characteristics of the Future More research does not mean less uncertainty. Research hardly ever finds a silver bullet or the one right answer. Some issues cannot wait for clarification. long development time scales uncertain tipping points Causes and consequences of problems are non-linear.© Menlo Park Associates, LLC 13
  14. 14. Menlo Park Associates, LLC PDSA into the Unknown What Scenario Are We In?© Menlo Park Associates, LLC www.worldclimatereport.com/index.php 14
  15. 15. Menlo Park Associates, LLC PDSA into the Unknown Scenarios (1)© Menlo Park Associates, LLC 15
  16. 16. Menlo Park Associates, LLC PDSA into the Unknown Characteristics of Solution The benefit/cost ratio of remediation is greatest when a problem is first recognized. Uncertainty will never be eliminated. Surprises are the rule, not the exception. Uncertainty must not lead to analysis paralysis. ‘Optimal’ strategies may not be.© Menlo Park Associates, LLC 19
  17. 17. Menlo Park Associates, LLC PDSA into the Unknown A Really Great Slide© Menlo Park Associates, LLC www.jpl.nasa.gov/images/earth/coastalerosion-chart-browse.jpg 20
  18. 18. Menlo Park Associates, LLC PDSA into the Unknown Principals to Follow Reduce uncertainty through action, not research. Take incremental steps. Explore a wide range of future scenarios. Seek robust strategies that do well across many scenarios. Monitor the future as it unfolds. Make mid-course corrections, as needed.© Menlo Park Associates, LLC 21
  19. 19. Menlo Park Associates, LLC PDSA into the Unknown Dr. Pollack’s Philosophy “…develop a long-term vision and make plans to move ahead—but to be prepared for many course corrections along the way, as the future unfolds quite differently than you anticipated.”© Menlo Park Associates, LLC 22
  20. 20. Menlo Park Associates, LLC PDSA into the Unknown Dr. W. Edwards Deming© Menlo Park Associates, LLC www.deming.org 23
  21. 21. Menlo Park Associates, LLC PDSA into the Unknown Deming’s System of Profound Knowledge Appreciation for a System A system is a network of interdependent components that work together to try to accomplish the aim of the system. Theory of knowledge Management is prediction. Knowledge is built on theory. Understanding of psychology Knowledge about variation Life is variation. Special vs. common causes of variation.© Menlo Park Associates, LLC 24
  22. 22. Menlo Park Associates, LLC PDSA into the Unknown Appreciation for a System Systems must have a clear AIM. System components are interdependent. Sub-optimization must be eliminated. The obligation of a component is to contribute its best to the system, not to maximize its own production, sales, or profits. Optimization for everyone concerned should be the basis for all negotiation within the system and between any of the components.© Menlo Park Associates, LLC 25
  23. 23. Menlo Park Associates, LLC PDSA into the Unknown Theory of Knowledge Management is prediction: modeling a process and projecting its performance into the future. Knowledge is built on theory. Knowledge is not the same as information. Knowledge also implies prediction. When prediction fails, then a new theory is needed. Organizations need such knowledge to understand how they operate and do continual improvement.© Menlo Park Associates, LLC 26
  24. 24. Menlo Park Associates, LLC PDSA into the Unknown Understanding of Psychology Psychology helps us to understand people and interaction between people and circumstances, customer and supplier, teacher and pupil manager and people managed How are people different? How are people motivated?© Menlo Park Associates, LLC 27
  25. 25. Menlo Park Associates, LLC PDSA into the Unknown Knowledge About Variation Special and common causes of variation Avoid mistaking one for the other. A process is stable when its variation is predictable. Eliminate special causes of variation. Only a stable process can be improved. Reduce variation or change some process aspect by under- standing common causes of variation and using a cycle of continual improvement.© Menlo Park Associates, LLC 28
  26. 26. Menlo Park Associates, LLC PDSA into the Unknown Stabilize Process Performance© Menlo Park Associates, LLC 29
  27. 27. Menlo Park Associates, LLC PDSA into the Unknown Continual Improvement Uspec = 19 Lspec = 7© Menlo Park Associates, LLC 30
  28. 28. Menlo Park Associates, LLC PDSA into the Unknown The Deming/Shewhart Cycle Plan a change or a test, aimed at improvement. Do – carry out the change or the test (preferably on a small scale). Study the results. What did we learn? What went wrong? Act – adopt the change, or abandon it, or run through the cycle again.© Menlo Park Associates, LLC 31
  29. 29. Menlo Park Associates, LLC PDSA into the Unknown Applying PDSA towards the Unknown 1. Plan: define scenarios, strategies, goals, and incremental actions to attempt. 2. Do: pilot the plan or experiment to verify its assumptions. 3. Study the results of the pilot or experiment. 4. Act to implement the incremental action or decide on refinements© Menlo Park Associates, LLC 32
  30. 30. Menlo Park Associates, LLC PDSA into the Unknown Plan for the Unknown 1. Explore a wide range of starting assumptions and conditions and future scenarios. 2. Define goals against which potential future outcomes will be evaluated. 3. Define questions that will reveal progress towards the goals. more...© Menlo Park Associates, LLC 33
  31. 31. Menlo Park Associates, LLC PDSA into the Unknown Plan for the Unknown 4. Define measures that will answer the questions, (including procedures and tests that will provide operational definitions). 5. Plan incremental actions to make progress towards the goals.© Menlo Park Associates, LLC 34
  32. 32. Menlo Park Associates, LLC PDSA into the Unknown Do towards the Unknown 1. Pilot the incremental action to learn something about its consequences on a larger scale, or 2. Perform an experiment to test assumptions or otherwise verify the plan.© Menlo Park Associates, LLC 35
  33. 33. Menlo Park Associates, LLC PDSA into the Unknown Study what was Unknown 1. Check the experiment to see if the plan needs refinement, or 2. Check the measures to see if the pilot incremental action verifies the plan and/or indicates refinement needed in the plan.© Menlo Park Associates, LLC 36
  34. 34. Menlo Park Associates, LLC PDSA into the Unknown Act in the Unknown 1. Decide whether to go back to the planning step, or 2. Implement the incremental action on a larger scale, or 3. Decide if the incremental action needs refinement and define why and how.© Menlo Park Associates, LLC 37
  35. 35. Menlo Park Associates, LLC PDSA into the Unknown PDSA into the Unknown Repeat as needed. 1. Plan: refine scenarios, goals, and incremental actions. 2. Do: pilot or experiment to verify the plan. 3. Study the results of the pilot or experiment. 4. Act to implement the incremental action or decide on refinements© Menlo Park Associates, LLC 38
  36. 36. Menlo Park Associates, LLC PDSA into the Unknown Keeping Track (j) ty 1 2 4 5 Level 1 of Probability bili gy gy gy gy gy VALUE of Scenario (i) being ate ate ate ate ba ate Analysis Strategy (j) the TRUE situation … Pro under Scenario (i) Str Str Str Str Str Scenario 1 Scenario 2 Scenario (i) p(i) v(i,j) Expected SUCCESS Scenario 4 of Strategy (j) = Scenario 5 SUM(v(i,j)*p(i)) … 100% S(j)© Menlo Park Associates, LLC 39
  37. 37. Menlo Park Associates, LLC PDSA into the Unknown Failures We also call these learning opportunities Some failures (like the Tacoma Narrows Bridge) occur in belief we are not in the Unknown. Electric cars (GM, Ford, and others) Single scenario, non-robust, solution© Menlo Park Associates, LLC 40
  38. 38. Menlo Park Associates, LLC PDSA into the Unknown Successes Manhattan Project There were actually two atomic bomb projects. One used Uranium and a linear trigger system. A second used Plutonium and a spherical trigger system. They both worked.© Menlo Park Associates, LLC 41
  39. 39. Menlo Park Associates, LLC PDSA into the Unknown Partial Successes Toyota Prius electric hybrid car Uses gasoline engine to charge batteries and drive electric motors. Cannot be charged up overnight (battery is too small and no electric connection available.) For $10-$12,000 you can upgrade the batteries in a Prius and add a plug you can use to charge them overnight. A robust strategy even Toyota missed, but likely to be corrected now that there is demand for it.© Menlo Park Associates, LLC 42
  40. 40. Menlo Park Associates, LLC PDSA into the Unknown Why It Is Difficult Perception is distorted by the lens of complexity. Too many parameters with non-linear relationships Natural inclination is to predict future by extending the past. Radio people did not invent television. RCA did not invent the transistor. CBS did not invent CNN. Lexis/Nexus did not invent Google. IBM did not invent the personal computer. Keds did not invent Nike. It is hard to hit the bulls-eye when you cannot see the target.© Menlo Park Associates, LLC 43
  41. 41. Menlo Park Associates, LLC PDSA into the Unknown Why the Method Helps Uncertainty is reduced through action, not research. Real lessons and understanding are learned early. Incremental steps reduce LARGE errors. Real scenario is likely in a wide range of scenarios. Effective strategies are more likely to be found. Feedback permits mid-course corrections. Before major investment is lost Before tipping point is reached© Menlo Park Associates, LLC 45
  42. 42. Menlo Park Associates, LLC PDSA into the Unknown Applications Global policies Global warming Global economics Outsourcing, developing countries National policies Corporate planning© Menlo Park Associates, LLC 46
  43. 43. Menlo Park Associates, LLC PDSA into the Unknown Thank you© Menlo Park Associates, LLC www.thehenryford.org 47
  44. 44. Menlo Park Associates, LLC PDSA into the Unknown References/Reading 1. Deming, W. Edwards. 1993. The New Economics. Cambridge: Massachusetts Institute of Technology. 2. Pollack, Henry. 2003. Uncertain Science, Uncertain World. New York: Cambridge University Press. 3. Pollack, Henry. 2006. Scientific Uncertainty and Public Policy: Moving on Without All the Answers. Presentation for Saturday Morning Physics, University of Michigan, March 18, in Ann Arbor, Michigan. 4. Lempert R., Popper, S., Bankes, S. 2003. Shaping the Next 100 Years. Santa Monica: RAND.© Menlo Park Associates, LLC www.thehenryford.org 48
  45. 45. Menlo Park Associates, LLC PDSA into the Unknown Contact Information Richard L. Bollinger Menlo Park Associates, LLC 618 Fifth Street Ann Arbor, Michigan 48103 +1.734.662.7752 rick@menloparkassociates.com www.menloparkassociates.com© Menlo Park Associates, LLC www.thehenryford.org 49

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