Organise for Learning & Innovation David and Sarah Kerridge Summary To create an organisation which can learn, adapt, and above all innovate we need four things: A culture which encourages learning Circumstances which make it physically possible to learn Knowledge of how to learn Management which sets an example of learning All these follow from application of the System of Profound Knowledge, and the principles which arise from it. Experience alone is not enough To do anything well we need skill, knowledge, and understanding. All of these improve with experience up to a point, but it is very easy to deceive ourselves. A juggler can learn from exper- ience because he knows when he drops a ball. A teacher never knows the effect, over a lifetime, of what he or she teaches. Of the three, skill is the easiest to improve, and understanding hardest. It is usually easy to tell when we lack skill, but not when we lack understanding. Without understanding, we do not know what is missing. The first step is to recognise the need to learn. This applies just as much to gathering existing knowledge, as to finding out for ourselves, which is innovation. Both forms of learning are essential. It is wasteful to ignore what is already known, in the form of subject knowledge. We must also study our own systems, under the special conditions which apply to them. Every organisation is in some way unique: innovation is required to run it efficiently, let alone to change it for the better. There are some remarkable examples in history of people not learning from experience. For more than two thousand years, the medical treatment for fever was to remove a pint of blood. The doctors who did this were not stupid: many were very acute observers, who described diseases in a way that we cannot better today. They simply did not know how to learn from experience. If we think that we would have done better than they did, we should remember that many management practices, such as ranking, are much worse than blood-letting. Losing a pint of blood rarely killed patients, apart from those too weak to survive anyway. At least it was cheap, compared to other treatments. Remove cultural barriers To organise for learning and innovation, it is not enough that you want to learn. If you did not want to learn, you would not be here. The problem is to help everyone else to admit openly that they too need to learn. This can be difficult in the traditionally managed organisation: there are cultural barriers to learning in all directions. It is easiest to see this if we see the barriers to the spread of existing knowledge. Here are some examples: 1) Afraid to admit ignorance. A manager told me that he had just been appointed Quality Manager of the branch of his firm in a remote part of the world. His previous experience was in public relations, and he had only three weeks to learn about quality. He dared not tell his chief executive that this was not long enough. Even in a university I met a lecturer who was afraid to ask for my advice on a statistical problem unless I promised not to let his head of department know he had consulted me. 2) Afraid to be proved wrong It can be very hard for a manager in the existing culture to admit that his new ideas could be wrong, and that they must be thoroughly tested before being used. It is even harder to admit that what he could have been doing the wrong thing for years. A tactful approach is "We have been doing that for a long time, and a lot of things have changed: we ought to see if it still works". 3) Status or security depends on keeping others ignorant. In a research group, we were discussing the need for clear, readable reports. One of us commented that clear reports were not always appreciated. He quoted the words of a colleague in his firm: "If my boss can understand the reports I write he will think I don't know my job". I also met someone who would not pass on the secrets of his own success. Many of these were technical improvements found by extensive and laborious experiment: "if I do, someone else could do my job". 5) Status depends on being above mere "technical matters". I have very often heard people say that experts should be "on tap, but not on top". This produces a snobbery of ignorance: not knowing, like not getting the hands dirty, may be regarded as a mark of high status. We do not need to create a desire to learn: it is an instinct. What we must do is to remove the destructive forces which crush it. Then management example, not pressure, will restore joy in learning. Make it possible to learn It is very frustrating to want to learn, but not have the means to do it. The means include stability, accurate inform- ation, facilities, and time. Stability is the least obvious, but the most important. When everything changes all the time it is almost impossible to learn from experience. This is true whether change comes from reorganisation, changes in aim, or variation in raw materials. Suppose that you make a change, that you think will be an improvement. If the system is under statistical control it will be easy to tell if the improvement is real, but not otherwise. This illustrates the importance of understanding variation. The more variation is reduced, the easier it is to learn: a rule which applies even more strongly to special cause than to common cause variation. Accurate information is particularly hard when it concerns services. These may be within manufacturing industry, or in wholly service organisations. We are not dealing with mass- produced mechanical components, with dimensions that can easily be measured, but with providing benefits matched to each indi- vidual customer. Some of the problems of getting the right information are discussed separately, in the document "What does the customer want?". In a fear-driven organisation it will be impossible to collect accurate, unbiased, information. Everyone will "cover up" to avoid being blamed for failures of the system. Or if we fail to "Break down barriers between staff areas", the organisation can not work as a system. Information will not reach the place where it is needed, or will arrive too late, and in a corrupted form. Facilities for learning may be limited by the practices which Dr Deming calls "deadly diseases". Take for example the situation, common in many industries, in which the skilled employees move rapidly from one company to another. No employer wants to pay for training or education which will only help the employee to move to a different organisation. This is particul- arly noticeable in the new, rapidly growing service industries such as computer software. In the same way, concentration on visible figures leads managers to treat training and research as costs to be cut back, rather than long-term, profitable, invest- ments. Time is always a problem, in the untransformed organ- ization. Everyone is too busy fire-fighting, or "having another reorganisation". The most recent addition to the list of reasons for not learning is "too busy installing ISO 9000". Many of the bad practices described in "Out of the Crisis" and "The New Economics" carry a double penalty. They do harm in themselves, and they waste resources: the scarcest of which is manager's time. Another thief of time, which I recognise from my own experience as head of a department, is unreasonable guilt. I was so used to responding to immediate, but relatively trivial problems (like meeting arbitrary deadlines), that I felt guilty whenever I did something really useful, like wondering about the real aim of the system. Clear priorities, based on a universally accepted common aim, is essential to a learning culture. Just as in the last section, we can see how Dr Deming's general principles make learning and innovation possible. Knowing how to innovate For effective innovation, an organisation must have, in addition to all the other things: 1) plentiful supplies of creative ideas. 2) disciplined and thorough ways of testing them. 3) systems for benefitting from the knowledge gained. Creative ideas need not be in short supply, but it is very easy to produce a shortage. The problem is that everyone starts with great enthusiasm, with the feeling that they "know" how to improve the system. Many of the ideas that individuals produce have already been tried and failed, or are (to others) obviously absurd, or would cause too much chaos elsewhere in the organis- ation. Managing this situation calls for leadership. Do not let anyone ridicule a suggestion, but try to find something useful in each idea. If nothing else, it can be used to help everyone to examine their hidden assumptions about the way things are done. Even if it has been tried, it may have failed for reasons which no longer apply. Many of the most useful innovative ideas seem absurd, until they have been shown to work. The encouragement of creativity is, in the long term, more important than the immediate improvements. The System of Profound Knowledge provides the best way to both encourage creative thinking, and to guide it into useful channels. Above all, it is important not to start looking for improvements until the aim of the system is clear to all. Disciplined and thorough ways of testing depend on the PDSA cycle. It is not enough for everyone to understand how to use it, they must know why it matters, and why it takes the form it does. The PDSA cycle is the particular form which scientific method takes, when it is applied to complicated systems. For the theory behind it see "Scientific method Applied to Systems". Putting an idea to work sounds easy: "That's a good idea, let's do it!" is a very natural reaction. To insist on thorough testing may seem a discouraging response to a brainwave. The reason why it must be done is that a system must be treated as a whole. No change ever takes place without having effects which can not be anticipated. An idea that is good in itself may not work unless improvements are made elsewhere. What is more, an excellent idea may fail, if introduced without careful planning. The PDSA cycle is used to make sure that good ideas do work, not to prevent them being tried. A idea, however good it is, is not useful as it stands. It must be put into operational form: see the document "Operational Meaning". In the theory of knowledge, a "theory" is not just an idea, or an explanation, but a rule for making predictions about the future. These predictions must be capable of being checked by observation. It is quite possible, and indeed often happens, that a basically good idea generates incorrect predictions (because the system is not fully understood), and so seems to be discred- ited. The "Plan" step of the PDSA cycle is meant to make sure that good ideas are not wasted. Benefitting from the knowledge gained is far from auto- matic. For example, my friend Dr J Crookes set up a study to see whether well established medical knowledge was used effectively. He took as an example the well-known fact, taught to every medical student, that patients who have had part of the stomach removed need regular vitamin supplements. A survey of patients several years after discharge from hospital, showed that only half were receiving supplements, and many were vitamin deficient. There are many similar examples. Transformation depends on education and training as a system to spread knowledge, as well as innovation. If new ideas are not being fully used, the learning culture has not yet been established. Check that all barriers have been removed, and then supply the final ingredient: management that sets an example of learning. Conclusion There is no substitute for Profound Knowledge. Techniques are useful: but they do not create a learning and innovating organisation, any more than sharp knives make a brain surgeon. But some methods, in particular flow diagrams, control charts, and the PDSA cycle can be used to educate, as well as to solve problems. In the long run, education is far more important than any short term gain.