Look Before You Leap

Once upon a time, an engineering consulting company hit a speed bump. Revenue was falling so fast that staff attrition couldn't keep up with the contraction. So management leapt into action, declaring a salary freeze.

But there was a carrot — if the company met its revenue target, everyone would get a bonus. In consulting, revenue equates roughly to billable hours, so the engineers did their best to help Marketing find business. Trouble was, there wasn't enough business.

With less than a month to go before the CEO's annual state-of-the-company address, Management announced a buy-out for people close to retirement. After his address, in Q&A, a bright engineer asked him, "Since so many are taking the buy-out, we won't have enough billable hours left to meet the bonus target. Does this mean there's no bonus?"

Jacques, the CEO, was blind-sided, but he was no dummy. He knew that if he said yes, he could expect an exodus of his best engineers. So he replied, "I'll have to get back to you on that." Back in the calm of his office, Jacques and his team worked out the right answer: "We'll lower the bonus target proportionately."

So they issued a memo, and everyone relaxed some. But Jacques had been embarrassed at a time when he needed to show strong leadership. He probably wasn't ready for that question because it involved an intersection of two unrelated policies. Since there are so many policies in any company of even moderate size, the number of such intersections is large, and it's difficult to anticipate which intersections cause problems.

The executive team goofed, as most do now and then. Yet, even though we test our products thoroughly, we rarely test organizational changes before we "roll them out." It's a high-risk practice, because we end up testing our change plans using the company itself. To limit that risk, we must discover defects in change efforts before we execute them, and one approach that works well is the simulation.

Even though we test
our products thoroughly,
we rarely test organizational
changes before we
"roll them out"Simulations — sometimes called "games" — parallel reality. They're especially valuable when the event being simulated is high-risk. That's why the military runs war games, and why US presidential candidates run mock debates.

Simulations do require planning to ensure that they're faithful to reality, and you do need a skilled facilitator. But you can use simulations to test almost any organizational effort — process designs, project plans, test plans, reorganizations, mergers and acquisitions, marriage proposals — anything. Simulations can be off-site and small-scale, and you can use stand-ins for the actual players if security is an issue.

Next time you have that queasy feeling about your plans, look before you leap — simulate.  Top    Next Issue

Is your organization embroiled in Change? Are you managing a change effort that faces rampant cynicism, passive non-cooperation, or maybe even outright revolt? Read 101 Tips for Managing Change to learn how to survive, how to plan and how to execute change efforts to inspire real, passionate support. Order Now!

Your comments are welcome

About Point Lookout

Thank you for reading this article. I hope you enjoyed it and found it useful, and that you'll consider recommending it to a friend.

This article in its entirety was written by a human being. No machine intelligence was involved in any way.

Point Lookout is a free weekly email newsletter. Browse the archive of past issues. Subscribe for free.

Support Point Lookout by joining the Friends of Point Lookout, as an individual or as an organization.

Do you face a complex interpersonal situation? Send it in, anonymously if you like, and I'll give you my two cents.

Related articles

More articles on Organizational Change:

When Fear Takes Hold

Leading an organization through a rough patch, we sometimes devise solutions that are elegant, but counterintuitive or difficult to explain. Even when they would almost certainly work, a simpler fix might be more effective.

Kinds of Organizational Authority: the Formal

A clear understanding of Power, Authority, and Influence depends on familiarity with the kinds of authority found in organizations. Here's Part I of a little catalog of authority classes.

Good Change, Bad Change: I

Change is all around. Some changes are welcome and some not, but when we distinguish good change from bad, we often get it wrong. Why?

When Change Is Hard: II

When organizational change is difficult, we sometimes blame poor leadership or "resistance." But even when we believe we have good leadership and the most cooperative populations, we can still encounter trouble. Why is change so hard so often?

When Your Boss Leaves Before You Do

At some point in your career, your supervisor will leave his or her position and you'll end up reporting to someone else. It can be a harrowing experience, even if you prepare. Nevertheless, preparation usually produces a better outcome than winging it.

See also Organizational Change for more related articles.

Forthcoming issues of Point Lookout

Coming September 24: Time Is Not a Resource

In the project management community, it's often said that time is the most precious resource. Although time is indeed precious, to regard it as a resource — like finance, equipment, or people — can be a dangerous mistake. Time is not a resource. Available here and by RSS on September 24.

And on October 1: On the Risks of Obscuring Ignorance

A common dilemma in knowledge-based organizations: ask for an explanation, or "fake it" until you can somehow figure it out. The choice between admitting your own ignorance or obscuring it can be a difficult one. It has consequences for both the choice-maker and the organization. Available here and by RSS on October 1.

Coaching services

I offer email and telephone coaching at both corporate and individual rates. Contact Rick for details at rbrenaXXxGCwVgbgLZDuRner@ChacDjdMAATPdDNJnrSwoCanyon.com or (650) 787-6475, or toll-free in the continental US at (866) 378-5470.

Get the ebook!

Past issues of Point Lookout are available in six ebooks:

• Get 2001-2 in Geese Don't Land on Twigs (PDF, )
• Get 2003-4 in Why Dogs Wag (PDF, )
• Get 2005-6 in Loopy Things We Do (PDF, )
• Get 2007-8 in Things We Believe That Maybe Aren't So True (PDF, )
• Get 2009-10 in The Questions Not Asked (PDF, )
• Get all of the first twelve years (2001-2012) in The Collected Issues of Point Lookout (PDF, )

Are you a writer, editor or publisher on deadline? Are you looking for an article that will get people talking and get compliments flying your way? You can have 500-1000 words in your inbox in one hour. License any article from this Web site. More info