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Ambiguity.Dilemma.Conflicts - The powerful force blocking growth of the organization

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Mckinsey's Global Survey Report on Implementing Change with Impact reveals that companies are best at using standardized procedures and assessing employees; many lack effective problem-solving processes and meetings.

And the truth is that business innovation happen and decisive competitive edge is created when real problems are solved. Most companies are now asking where is that exact problem solving which has the potential to make big business impact.
Here is a primer on the type of problem and problem solving approach that can help your team in building the new capability for today's business conditions.

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Ambiguity.Dilemma.Conflicts - The powerful force blocking growth of the organization

  1. 1. Draft Version 1.0 Ambiguity.Dilemma.Conflict Understanding the Powerful Force Blocking Growth of the Organization Call it ambiguity or dilemma or conflict, organizations are pulled apart in opposite directions leaving them to compromises and half baked decisions that only have devastating impact on their survival, growth and profitability. In fact, such situations throw real opportunities for creating breakthrough solutions. By recognizing it as a management problem of specific type, this document provides insights into the nature of such situations and gives directions to build win-win solutions that can drive business innovation. Shridhar Lolla 6/10/2014
  2. 2. 2 Copyrights ©2014, Shridhar Lolla. All Rights Reserved. Ambiguity.Dilemma.Conflict Note: The three words are used here in an interchanging way. The hyper links provided in the document may not be active on slideshare (or borwser). To enable them and connect to view the source you may need to freely download the complete document. Most often, an Ambiguity or call it Dilemma or Conflict has two sides, each one important and necessary. Look at the below diagram. Figure 1: An ever increasing number of Dilemma's constantly dilutes management bandwidth and prevents organization from achieving growth with stability and harmony There is no limit on the variety of dilemmas faced in today's complex business environment. They occur at strategic levels as well execution and operating levels. In fact, these are faced at every level in the organization, in every function and by everyone. This also means that resolution of such dilemmas is not a reserve of just a few of managers or leaders. Rather, everybody must be equipped to deal effectively with dilemmas occurring in their scope of engagement. Indeed, resolving dilemmas is integral to managerial decision making. Traditional Way of Responding to Dilemmas When dilemmas surface, the normal response is to find a mid way and do a balancing act (how many times we heard someone saying, 'we have a nice balance between...'), which only leads to status quo and compromises with devastating consequences. The compromises made are often like agreeing on the height of a wall to be the average of two vastly different values obtained from two different technique of measurement; while the height of the wall is what it is in reality. Another practical example of gory compromises dilemmas lead to is about the discipline of following quality and the requirement to increase throughput (deliveries). Even today, in a vast majority of organizations, teams follow quality guidelines very strictly in the first half of the month (year), only to break all rules to push their throughput and meet targets in the second half of the month (year). Ills of this syndrome are too well There is no limit on the variety of dilemmas managers are hard pressed to solve in today's complex business environment.
  3. 3. 3 Copyrights ©2014, Shridhar Lolla. All Rights Reserved. known and pervade across functions. It caused severe dents to the decades of quality reputation of Toyota when such compromise led Toyota to recalled 9 million cars worldwide causing several accidents and loosing over a billion dollars in repairs. Even today, impact of such syndrome is creating heavy media buzz about dirty medicines in pharma industry to such an extent that the faith of common people on pharma companies is at its nadir. Although in short terms, compromises, short cuts, appeasements and work-arounds seem to calm down the two sides of dilemma, eventually such an approach becomes fatal to the survival, growth and profitability of the organizations. It is a Conflict Resolution Problem The capability required to deal with situations full of dilemmas is simple but not trivial. First, one has to understand that it is altogether a different class of problem in the domain of 'management problem solving'. This means that it needs a particular approach to solution. Ambiguities, dilemmas and conflicts are not the problems of alternatives, like making a choice between two technologies. Nor it is a problem of allocating or distributing resources by isolating the two sides of the dilemma. It is a type of problem where two sides are right, correct or necessary but focus on one will diminish positive and desired impact of other; the solution to such problems falls in the domain of Conflict Resolution. In a conflicting situation, it becomes important to be explicit in the assumptions behind the proposals of the two conflicting sides. When the assumptions behind the two sides are made explicit and exact, the issue where the two sides collide is identified and each side understands other's concern, they together come out with a win-win solution that is not a compromise. In fact, such solutions often lead to breakthrough business innovation while creating a harmonious environment within the organization. The Dilemma of Innovation or Efficiency Let's look at one such major conflict and understand outline of a win-win solution. We take reference for this conflict from Linkedin post of Fancisco D'Souza's, the CEO of Cognizant Technology Solutions. He opened up a discussion on a dilemma saying 'Should Organizations Focus on Efficiency or Innovation? Both. Here’s Why.' Figure 2: Each dilemma has two sides, one is no less important and necessary for the organization than the other The management problem of Dilemma falls in the domain of Conflict Resolution. Most of organizations fail in dealing with this type of problem Mckinsey's Global Survey Report on Implementing Change with Impact reveals that companies are best at using standardized procedures and assessing employees; many lack effective problem- solving processes ...
  4. 4. 4 Copyrights ©2014, Shridhar Lolla. All Rights Reserved. Without any doubt every organization will have two camps favoring one side over the other. Those who favor focusing on Efficiency believe that by focusing on innovation, organizational processes are loosened, deliveries get beaten down and business performance is adversely affected. Those who favor innovation, believe that focusing on efficiency to improve current performance will jeopardize future of the company. In summary, the two opposite choices create tug of war between NOW and FUTURE of the company. In fact, most of the dilemmas can be brought down to this generic conflict. What makes an organization to feel that the two sides are conflicting? There is an obvious truth. Given the soaring ambitions of leaders driving organizational growth, every organization operates in a resource constrained environment. Most organizations suffer from limited management bandwidth, team and finances. Given such a situation in an ever more complex world, there is always tug of war for resources (time, talent, money). Walk into any organization and you would see how management bandwidth is thinning out and how much firefighting, trade-offs and burnouts already exist. No wonder, organizations are often divided into two camps once guarding innovation and demanding higher allocation of resources there, while the other one guarding efficiency. Such conflicts pull organizations in opposite directions. Those who are at the helm of the affairs know that actually, organizations need to maximize both and not make any compromise. Conflicts of the type discussed here can be drawn in the following simple and intuitive way. Figure 3: A simple way of visualizing management dilemma Now we need to ask right questions on this conflict diagram. Why do we think that Focusing on Innovation will reduce the ability of the organization to leverage existing investment (reduce current performance of the organization); and why focusing on efficiency will jeopardize future of the organization. While I am not describing here all the assumptions that will surface up, innovation will jeopardize the benefits of efficiency if the outcome of the innovation effort does not leverage the efficiencies created today. Right solution to a Dilemma is not a choice between two sides, but is a win-win solution.
  5. 5. 5 Copyrights ©2014, Shridhar Lolla. All Rights Reserved. On the other hand, efficiency focus will undermine effort of innovation if it does not create a space for innovation to prosper. When the right solution is obtained, we would see that innovation and efficiency will feed each other. It actually leads to a paradigm shift, as shown in the figure below. Such a solution will be free from costly investment, pains of restructuring and real risks posed by other alternatives. And most importantly, results of such a solution can be seen in a very short time. Figure 4: Conflict Resolution leads to Paradigm Shift and opens up venue for Business Innovation Today management tools exist such that focus on efficiency can be maintained without costly investment in creating new huge capacity to drive innovation. At the same time, there are management approaches to innovate the process of innovation process itself such that it leverages efficiency. The breakthrough solution obtained thus will often depend upon the state of particular organization. Francisco D'souza in his post mentions that Cognizant resolved the dilemma between innovation and efficiency by redesigning the organization across three horizons, each with its own business model, talent, metrics and policies. A massive effort indeed, now after three years, it has been working well for the organization. In another organization, the tenacity of the team led to an altogether different solution to the same problem with significant benefits. Without taking any major risk and incurring expensive investment, the organization improved efficiency by an order of magnitude in a very short time. This led to releasing huge capacities and hidden capital in the organization. The release of capacity provided huge bandwidth to management that was then used to drive innovation in a focused way. Solving Dilemmas without compromise leads to breakthrough business solution.
  6. 6. 6 Copyrights ©2014, Shridhar Lolla. All Rights Reserved. Examples Here are some examples of breakthrough solutions obtained by solving management dilemmas: Table 1: Examples of management dilemmas and breakthrough solutions The list of dilemmas is never ending...but every team must themselves find the win-win solution and innovate their business. In fact, growing Ambiguities or Dilemmas or Conflicts are just one amongst the set of forces that prevent organizations and leaders from achieving ambitious growth. To know more about these forces please refer the presentation Focused Management on my slideshare. Also, the book, Choice by Eli Goldratt, from where the idea of conflict resolution is adopted. __________________________________________ About the Author: Shridhar Lolla, PhD Shridhar Lolla is a business coach, and specializes in Focused Execution, Business Model Innovations and Operational Excellence. Active across industries, he advices organizations in successively delivering ambitious business results despite the devastating trio of Complexity, Uncertainty and Ambiguity. Shridhar is an engineer by qualification and holds a PhD from IIT Delhi. Earlier in his career, he held leadership positions at ABB, the Swiss automation and power technology conglomerate. He has also authored two contemporary books on organizational effectiveness. Shridhar lives in Bangalore, India and can be contacted at +91 94480 70081 or email id lolla@cvmark.com. Linkedin Profile: http://www.in.linkedin.com/in/lolla

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